What is the FICO Score Scale
Lenders place a great deal of importance on your credit score. Because this number is an aggregate of your past credit accounts, they use it to guess at how responsible you will be with your future credit accounts. While this approach is not flawless, it is almost universally applied.
Your credit history is tabulated by three main reporting agencies. They collect and organize information regarding late payments and outstanding balances and put them into the form of a report. Then when you apply for credit, the lender can review your past behavior and make an informed decision as to whether or not to approve your request.
Your credit score and credit report are not the same thing. You can get a copy of your credit report once a year at no cost, simply by requesting it from the credit bureaus. However you will have to pay a small fee if you want to know your credit score.
Your credit score is also known as your FICO score. This is an acronym of the Fair Isaac Corporation. They were among the first to develop the scoring system that used by many lenders to adjudicate risk. The extent to which lenders use this the FICO score will vary, but there is no denying that it is a key factor in the approval process.
As much as the credit bureaus endeavor to maintain impeccably accurate records, occasionally mistakes do happen. For this reason it is very important to check your credit report regularly. If you do discover any errors or omissions they are easier to fix the sooner they are identified.
There is no denying that a high credit score makes it easier to be approved for credit and obtain better interest rates. In this light it is crucial to protect your credit rating. Be certain to make your loan payments on time, because late payments are the fastest way to bring down your score.
Lots of outstanding debt will drive down your score as well. Do not open up more credit accounts than you need. Additionally be careful when even applying for credit. Frequent credit bureau inquiries can hurt your score too. It is difficult to bring your score back up after it takes a hit, so it is not a responsibility to be taken lightly.
Your credit history is tabulated by three main reporting agencies. They collect and organize information regarding late payments and outstanding balances and put them into the form of a report. Then when you apply for credit, the lender can review your past behavior and make an informed decision as to whether or not to approve your request.
Your credit score and credit report are not the same thing. You can get a copy of your credit report once a year at no cost, simply by requesting it from the credit bureaus. However you will have to pay a small fee if you want to know your credit score.
Your credit score is also known as your FICO score. This is an acronym of the Fair Isaac Corporation. They were among the first to develop the scoring system that used by many lenders to adjudicate risk. The extent to which lenders use this the FICO score will vary, but there is no denying that it is a key factor in the approval process.
As much as the credit bureaus endeavor to maintain impeccably accurate records, occasionally mistakes do happen. For this reason it is very important to check your credit report regularly. If you do discover any errors or omissions they are easier to fix the sooner they are identified.
There is no denying that a high credit score makes it easier to be approved for credit and obtain better interest rates. In this light it is crucial to protect your credit rating. Be certain to make your loan payments on time, because late payments are the fastest way to bring down your score.
Lots of outstanding debt will drive down your score as well. Do not open up more credit accounts than you need. Additionally be careful when even applying for credit. Frequent credit bureau inquiries can hurt your score too. It is difficult to bring your score back up after it takes a hit, so it is not a responsibility to be taken lightly.
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For more further details about rating credit score scale and increasing your average FICO score check out The Credit Camp.
posted by Credit Counseling at
6:46 PM
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